For François Marchal, the Green Value Chain program has made it possible to accelerate investment decision-making by business leaders
Societe Generale (SG) Morocco received, on May 10 in Marrakech, the “Sustainability Gold Award for Financial Intermediaries”, issued by the European Bank for Reconstruction and Development (EBRD). For François Marchal, its managing director, the financing of sustainable development is in line with the rank of strategic priority within the Moroccan bank. It is also a major concern for its customers, who have expressed a strong need for support and financing in this area, in order to include their positioning within global value chains.
Le Matin: Societe Generale Morocco has just won the EBRD’s “Sustainability Gold Award for Financial Intermediaries”. What does this distinction mean to you?
Francois Marchal: This distinction is recognition of our commitment to support our customers in their transition to a sustainable and green economy. A commitment based on civic values as well as on the logic of partnership that prevails with our clients and the expertise of our resources, in every aspect of our banking business.
Societe Generale Morocco is one of the main partner banks of the EBRD for the strengthening of green financing in Morocco. What are the objectives of this partnership?
The financing of sustainable development, particularly in its component relating to the energy transition, is in line with the rank of strategic priority within Société Générale Maroc. This is also a major concern for our customers, who have expressed a strong need for support both in terms of the technical design of projects and in terms of financing. The main objective of our partnership with the EBRD is to accelerate investment decisions and the realization of projects with a positive environmental impact by Moroccan companies. This innovative partnership, which stands out from a classic financing approach, results in a support system as well as a set of incentives intended to strengthen the competitiveness of Moroccan companies, in a sustainable manner.
Indeed, in the logic of long-term partnership that we are building with our customers, it is essential in our view to promote their adaptation to future challenges in order to ensure their competitiveness and their resilience, which remain dependent on the optimization of costs as well as secure access to major world markets – whose environmental requirements are increasingly defined. The climate issue is crucial and the Kingdom has made strong commitments in this area, as part of a global dynamic. It is also a real opportunity for Moroccan companies to strengthen their position within global value chains. Recent events and the consequences of the war in Ukraine strongly attest to the need to reduce our dependence on hydrocarbons, by developing frugal approaches in terms of consumption of raw materials.
So far the two institutions have joined forces for two programs: Green Value Chain (GVC) and more recently GEFF. What solutions does SG Maroc offer for customers through these two mechanisms?
Our Business sales teams have been trained in energy transition issues and solutions, which enables them to identify, with our customers and prospects, their needs in this area and the opportunities they can seize, as well as their eligibility. to the programs that we deploy with the EBRD. In order to best meet the technical and financial support needs of Moroccan companies, SG Maroc and the EBRD offer comprehensive solutions including technical assistance on these environmental issues, provided by consultants who are experts in their sector, as well as a grant of investment that significantly reduces the cost of financing. This financing is thus structured by our teams on the basis of validated assumptions and investments, in the form of bank credit or leasing via our subsidiary Sogelease. This approach thus makes it possible to better calibrate the investment while facilitating its financing and its profitability.
What is your assessment of the GVC, already on the market?
As part of the Green Value Chain program, with a budget of 200 million dirhams, we have supported dozens of Moroccan SMEs in their investments aimed at modernizing their facilities or increasing their production, while limiting the environmental impact of their activities. All sectors of the economy are concerned, from the food industry to the chemical and pharmaceutical industry, including furniture. This program makes it possible to accelerate investment decision-making by business leaders, by reassuring them as to the sustainability of their project and the sustainable nature of the financing that accompanies it. Environmental emissions are very high, with each project carried out making it possible to avoid several tens of tonnes of CO2 emissions. The relevance of this support model has also led us to continue the partnership with the EBRD through the Green Energy Financing Facility line (the Bank signed a new financial agreement with the EBRD in early 2022 worth 25 million euros, relating to the GEFF line for the benefit of Moroccan companies, editor’s note).
Overall, how does Societe Generale Morocco align its credit and investment portfolios with the objectives of green and sustainable transition?
The Societe Generale group has been committed for many years to reducing the environmental footprint of the projects it finances, in particular through the application of the Equator Principles. It is also committed to adapting its portfolio of activities and financing to include it in the trajectory of limiting global warming to 1.5°. The Group is also one of the founding members of UNEP-FI’s “Net Zero Banking Alliance”, which plans to achieve carbon neutral portfolios by 2050. These Group commitments are mainly reflected in two ways within of Societe Generale Morocco. On the one hand, the systematic analysis of the environmental and social impacts of all project financing, with the gradual withdrawal of certain activities – such as coal, within the framework of sectoral policies. On the other hand, Societe Generale Morocco is increasingly strengthening the financing of projects with a strong positive environmental impact, while developing solid expertise on these themes for the benefit of our clients.
How does the price taking into account ESG criteria represent a challenge for the banking sector?
The consideration of social and environmental criteria by banks is essential for two reasons. It is a question of approaching a major lever of orientation for the economic actors, complementary to regulations that are increasingly enforced. It is also a strong expectation presented by both citizens and governments around the world. Taking ESG criteria into account does require banks to radically modify certain approaches, and to innovate to facilitate the support of our customers and the adoption of means of production that are more favorable to the environment and to the interests of populations. Preparing for the future with our clients is the very quintessence of banking.
What are your plans for green finance in Morocco?
As part of the pursuit of the “Grow with Africa” strategic program, we have set a target for 2025 of doubling our funding with positive impacts, as defined by the United Nations. To do this, we will continue to deploy partnerships and support the financing of renewable energy projects. This translates into the design of offers dedicated to certain priority sectors as well as easily duplicable technical solutions, which will lead to our leadership in the field.
Proposed by Moncef Ben Hayoun